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Parliamentary Committee Amends Finance Bill 2024

Kenya Kwanza Parliamentary Group met at State House Nairobi on earlier on Tuesday. MPs and Senators were taken through the changes made to the Finance Bill 2024 by Finance Committee Chairman Kimani Kuria.

Speaking at the meeting, President William Ruto said the changes to the Finance Bill have taken into account the views of the people and other stakeholders during public participation sessions.

The President commended Kenyans for their contributions through public participation.

“We are going to end up with a product in Parliament that came from the Executive and has been interrogated by the Legislature. Through public participation, the people of Kenya have had a say,” he said.

The Finance Bill has been amended to remove the proposed 16 per cent VAT on bread, transportation of sugar, financial services, foreign exchange transactions as well as the 2.5 per cent Motor Vehicle Tax.

Additionally, there will be no increase in mobile money transfer fees, and Excise Duty on vegetable oil has also been removed.

Levies on the Housing Fund and the proposed one on Social Health Insurance will not attract income tax, putting much more money in the pockets of employees.

The proposed Eco Levy will only be imposed on imported finished products that contribute to e-waste and thus harm the environment when they are no longer in use.

Consequently, locally manufactured products, including sanitary towels, diapers, phones, computers, tyres and motorcycles, and I’ll not attract the Eco Levy.

The President said the government is making efforts to curb importation of products that can be locally produced, thus protecting local manufacturing and securing jobs for the people.

“The stability you see in the foreign exchange regime is a result of our deliberate policies to reduce imports of things that are produced locally,” the President said.

He said the Eco Levy will be imposed on imported finished products, while those locally manufactured are exempted.

Consequently, locally manufactured products, including sanitary towels, diapers, phones, computers, tyres, and motorcycles, will not attract the Eco Levy.

The threshold for VAT registration has been increased from KSh5 million to KSh8 million, meaning that many small businesses will no longer need to register for VAT.

The Finance Bill has also imposed excise duty on imported table eggs, onions and potatoes to protect local farmers.

In the Bill, excise duty on alcoholic beverages will now be taxed based on alcohol content and not volume.

Additionally, pension contributions exemption will increase from KSh20,000 per month to KSh30,000.

On his part, the President explained that more resources have been allocated to education because it is the greatest equaliser

At the same time, President Ruto said the Executive and the Legislature will continue to work together in making the right decisions for the country.

President Ruto said tough decisions have yielded fruits, citing the drop in inflation from 9 per cent in 2022 to 5.1 per cent in May and strengthening of the shilling against the dollar.

He said the government is working on achieving a balanced budget in the next three years, pointing out that this will reduce borrowing and ensure that the country lives within its means.

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